This paper addresses the economic analysis of Mini dairy scheme which was implemented by the Government of Andhra Pradesh to improve the economic and nutritional status of farmers in rural area. A total of 100 respondents were selected randomly of Y.S.R. Kadapa district. Out of which 50 were beneficiaries and 50 were non- beneficiaries who were selected for comparative assessment of cost and returns, calorie intake and factors influencing the per capita income. A structured interview schedule was designed to elicit required information from the sample farmers. The total costs of the Mini dairy scheme were Rs.75, 363 12,636 for beneficiaries and Rs.81, 983 18,885 for non- beneficiaries. For two animals unit, the total returns, net returns, gross margin and returns per rupee of expenditure were found to be Rs. 2,17,302 , Rs. 1,41,939, Rs. 1,47,225 and Rs. 2.88 for beneficiaries and for non-beneficiaries, they were of the order of Rs. 1,43,891, Rs.30,776, Rs. 70,948 and Rs. 1.75 respectively. The beneficiaries received better nutrition in respect of quantity as well as calorie intake. The factors influencing per capita income of sample respondents with the help of multiple regression analysis for Mini Dairy stood at 0.32 and 0.37 revealing that the variables included in the function influenced variation in the per capita income to an extent of 32% and 37%, respectively for beneficiaries and non-beneficiaries.